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Make sure your business is protected if you're self-employed

Self-employed insurance helps to protect yourself from being out of pocket from legal action, data breaches or personal injury.
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Last updated
January 10th, 2024

What is self-employed insurance?

Self-employed insurance refers to the different types of business protection individuals who work for themselves can take out. This would include anybody who’s a sole trader, freelancer, consultant, or contractor.

Why get self employed insurance?

You're not legally required to have any form of self-employed insurance unless you have staff. But even if you work alone, it’s strongly recommended. Without insurance, you’d be responsible for any costs associated with accidents, injuries, or property damage that occur as a result of your business activities. This could lead to significant financial losses that could potentially put your business and personal finances at risk.

Overall, self-employed insurance can provide financial protection for individuals who have no employer to fall back on if something goes wrong. It's important to carefully evaluate your risks and choose the right covers to protect your business and assets.

Self-employed insurance provides financial protection for those who work for themselves.

What types of self-employed insurance can I get?

Self-employed public liability insurance

This can cover the cost of legal claims made against you if someone is injured or their property is damaged as a result of your business activities.

Professional indemnity insurance

This protects you if a client makes a claim against you for negligence, errors or omissions in your work, which causes them to lose money.

Employers’ liability insurance

If you employ anyone other than immediate family members, even on a temporary basis, you’re likely to need employers’ liability insurance. This can cover the cost of compensation claims made by staff who are injured or become ill as a result of their work.

Income protection insurance

This covers you if you are unable to work due to illness or injury, by providing a regular income to replace your lost earnings.

What types of self-employed insurance can I get?

Self-employed public liability insurance

This can cover the cost of legal claims made against you if someone is injured or their property is damaged as a result of your business activities.

Professional indemnity insurance

This protects you if a client makes a claim against you for negligence, errors or omissions in your work, which causes them to lose money.

Employers’ liability insurance

If you employ anyone other than immediate family members, even on a temporary basis, you’re likely to need employers’ liability insurance. This can cover the cost of compensation claims made by staff who are injured or become ill as a result of their work.

Income protection insurance

This covers you if you are unable to work due to illness or injury, by providing a regular income to replace your lost earnings.

What does self-employed insurance cover?

Covers

Damages or legal fees that may arise if someone is injured or their property is damaged as a result of your business activities.
Damages or legal fees that may arise if you make a mistake or are negligent in providing your professional services.
Damages or legal fees that may arise if one of your employees is injured or becomes ill as a result of their work for you.
May cover the cost of repairing or replacing any equipment that is lost, stolen, or damaged as a result of your business activities.
Any lost income or expenses that may arise if your business is unable to operate due to unforeseen circumstances such as fire, flood, or other natural disasters.

Doesn't cover

Any injuries or illnesses you may sustain yourself while working.
Any damages or legal fees that may arise from intentional or illegal activities.
Losses that may arise as a result of poor business decisions or market conditions.
Limited coverage for cyber attacks or data breaches.
Keep in mind that the types of cover you select typically determines what’s protected or what isn't. All policies have exclusions and may also have payout limits for certain claims, so it's important to check with your provider.

How to choose self-employed insurance

Choosing the right self-employed insurance policy can be a daunting task, but here are some tips to help you make an informed decision:

Assess your risks

Identify the risks that are specific to your business and assess how likely they are to occur. This will help you determine which types of insurance you need.

Compare policies

The quality of coverage usually holds more significance than the cost. Opting for the cheapest option could leave your business inadequately protected. Compare different policies and pick the right one for you.

Check the coverage limits

Make sure the coverage limits of the policy you’re considering are adequate for your business needs. For example, if you work with expensive equipment, make sure the policy would pay the full replacement value in case of loss or damage.

Look for additional benefits

Some policies offer additional benefits, such as access to legal advice or a claims helpline. Consider these additional benefits when comparing policies.

Seek professional advice

If you're unsure about which policy to choose or what coverage you need, seek professional advice from an insurance broker or independent advisor.

How much does self-employed insurance cost?

The cost of self-employed insurance depends on the type and level of policies required, the size of the business, and other factors. 

As a rough guide, public liability insurance for a self-employed person could cost from around £40-£200 per year, while professional indemnity insurance could cost from around £20-£300 per year.

Learn more about our business insurance partner

Superscript Logo Full 2x

We qualify, quantify and offer insurance using data, analysis and technology, and we serve a wide range of business types — from dog walkers and dieticians, to landlords and locksmiths. Enro Ltd t/a Superscript is authorised and regulated by the Financial Conduct Authority.

Why Superscript?

We make it quick and easy to find, buy and manage your business insurance.

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Customisable cover for 1000s of business types
Superscript will help you find the different types of cover that are right for your business.
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Adjust your cover as you grow
Amend your cover with no admin fees, to address your evolving needs as your business grows.
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Simple claims process
Our customer portal allows you to enter the details we need to get your claim processed.

FAQs

Is self-employed insurance mandatory?

Some types of insurance may be mandatory depending on the nature of your business.  Employers’ liability insurance is usually a legal requirement if you have temporary or permanent staff. Other types of insurance are optional, but could be worth considering to protect your business. Also, some clients will only work with you if you have a certain kind of cover, such as professional indemnity.

Can I get self-employed insurance quotes online?

Yes, many insurance companies, brokers and comparison sites like money.co.uk offer online quotes for self-employed insurance. It's a good idea to compare multiple quotes from different providers to find the best coverage and price for your needs.

Can I cancel my self-employed insurance policy if I no longer need it?

You can usually cancel your self-employed insurance policy at any time, although there may be fees or penalties for doing so. It's important to carefully review the terms and conditions of the policy before purchasing to understand the cancellation policy.

Do I need insurance if I’m running a business from home?

If you have specialist equipment, machinery or other expensive work-related items business insurance is probably a good idea. Just ensure you check what your home contents insurance will protect before getting additional cover. 

Bear in mind that if you host meetings with clients from home, you may need public liability cover.

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About the author

Salman Haqqi
Salman Haqqi spent over a decade as a journalist reporting in several countries around the world. Now as a personal finance expert, he helps people make informed financial decisions.

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